Judge Rules Against Radio Trade Group Petition

Broadcast radio’s trade group is doubling down on its effort to combine federal rate court proceedings that will determine how most of the country’s songwriters get paid for airplay, according to Billboard.

After a judge on May 26 denied the Radio Music Licensing Committee’s petition to combine rate court proceedings with leading performance rights organizations BMI and ASCAP under a single judge last week, according to a statement from BMI, the RMLC filed an appeal on Wednesday (May 31) at the U.S. Court of Appeals for the Second Circuit.

According to BMI’s interpretation of Southern District of New York Judge Louis Stanton‘s ruling denying the petition, neither the BMI Consent Decree nor the Music Modernization Act of 2018 justified the RMLC’s joint rate petition. Judge Stanton ordered the RMLC’s rate petition against ASCAP to be assigned to another judge and tried separately.

Just Stanton’s ruling instructs the court clerk to “sever all portions of the RMLC petition which seek the setting by a rate court of an ASCAP reasonable license fee under the ASCAP consent decree and assign them by the standard electronic method of selection of a judge of this court.”

The RMLC’s petition to combine the ASCAP and BMI under one judge who would simultaneously set rates for both performance rights organizations in once proceeding was based on what publishing sources have told Billboard is a wrong interpretation of the Music Modernization Act, which included a provision to moving rate hearings to a rotating roster of Southern District judges.

Having a single judge, instead of bifurcated rate court proceedings, could benefit the RMLC because it would likely pit BMI and ASCAP against each other, vying for a higher rate than the other and arguing over market share. In the past, Judge Stanton has overseen BMI rate trials and Judge Denise Cote has overseen ASCAP rate trials. Music publishing executives say that the MMA intended to keep the two-pronged approach for the PRO rate setting, but with rotating judges, not just the two who have overseen the proceedings up to now.

“We are extremely pleased that the RMLC’s latest attempt to deny fair compensation to songwriters was dismissed, and that its end run around the clear language of the BMI consent decree and the MMA was properly rejected by the Court,” BMI president and CEO Mike O’Neill said in a statement. “This would have cleared the way for BMI to secure the appropriate value of our affiliates’ music without the distractions the RMLC was trying to create. Unfortunately, the RMLC is once again opting for litigation over negotiation, and we will continue to do what is needed to protect the essential contributions our affiliates make to the radio industry.”

“It is unfortunate that the RMLC refuses to negotiate to pay songwriters fairly,” added ASCAP CEO Elizabeth Matthews in her own statement. “ASCAP is focused on obtaining fair market rates from radio for our more than 900,000 songwriter, composer and music publisher members. ASCAP will vigorously defend the value of our members’ music and fight the RMLC’s harmful attempt to weaponize its cartel market power to pay songwriters less.”